James Pethokoukis

Financial reform imploding; Dems declare War on Goldman Sachs

March 11, 2010

So it looks like financial reform is going to be Dodd-Dodd rather than Dodd-Corker. The consumer finance regulator is like the new public option, a real deal killer. Also not helping is the wider, harsher version of the Volcker Rule that a group of Dems have proposed. I call it the Goldman Sachs Rule since it is targeted at the supposed conflicts of interest GS has. Throwing GS into the mix further politicizes the process and makes compromise tougher. A real poison pill. But that might be the idea all along. Push a weak, Democrat-only bill vulnerable to a host of anti-bank amendments on the floor of the Senate. Then force Republicans to vote against them with the midterm elections looming. With the economy weak and healthcare unpopular, financial populist may be the only card Dems have to play.

The Obama Boom?

March 10, 2010

This Bloomberg story gives it the old college try with “Obama Defies Pessimists as Rising Economy Converges With Stocks.” It points out that the economy is expanding, job losses are down and stocks are up.

Senator Supply-Side?

March 9, 2010

Former Bear Stearns economist David Malpass is considering a run for US Senate in New York. If you believe in the wonder-working power of lower taxes, economic freedom and entrepreneurship, then you would probably find his candidacy an interesting one. The Washington Consensus, of course, is that spending cannot be cut so taxes must rise dramatically. Thus, Malpass would be a contrarian voice inside the Beltway.

More signs of a 2010 Republican surge

March 3, 2010

Forget the polls. Look at what the lobbyists are doing. Not only are campaign contributions to Republicans on the rise, advocacy firms are looking to hire more GOPers. So says CQ:

Zuckerman for Senate?

March 2, 2010

Heavens, a Mort Zuckerman bid for US Senate in New York would be great fun. Not a guy who loves to press the flesh, but supersmart and interested in getting things done. I just wonder if these CEOs who want to go to Washington fully realize how incredibly boring being a senator is.

Austerity makes for bad politics

March 1, 2010

It looks like the Conservatives in Britain are getting worried that their emphasis on deficit reduction is hurting the party with voters. Labour seems to be catching up in the polls:

Unemployment and the 2010 midterms

February 22, 2010

Charlie Cook has it exactly correct in this piece of analysis:

I’ve spent the last couple of days talking to some of the brightest Democrats in the party that are not in the White House. And it’s very hard to come up with a scenario where Democrats don’t lose the House. It’s very hard. Are the seats there right this second? No. But we’re on a trajectory on the House turning over….
There are nine months, certainly things could happen, but the odds of unemployment being below 9 percent are minimal by the time of this election. We’re probably going to have a year of basically, more or less, 10 percent unemployment, which hasn’t happened since the Great Depression. I mean, in fact, in an even-numbered year there’s only been one month of double-digit unemployment in the post-War era. One month. And now we’re going to have probably about a year.

The Volcker Rule: It’s not happening

February 16, 2010

A few points:

1) The much-hyped Volcker Rule proposal is failing fast in the U.S. Congress. But Paul Volcker himself probably isn’t that surprised. The former Federal Reserve chairman joked he was “just a photo op” even after President Barack Obama’s public embrace of his proposal to limit bank proprietary trading. More evidence that the moment for sweeping reform has probably passed.

Bayh’s good-bye

February 16, 2010

A few thoughts on Evan Bayh’s stunning retirement announcement:

1) It helps move the prospect of a GOP Senate takeover from a fringe idea to consensus. Not there yet, but getting there.

Illinois Senate race … meh

February 3, 2010

Illinois voters are not too thrilled with their choices for US Senate, according to Public Policy Polling: